A cost-cutting decision to outsource Qantas’ ground handling operations could see the airline shed up to 2,500 jobs, Australia’s national carrier has said in a statement.
Revenues fell by $4 billion in the second half of Qantas’ latest financial year due to Covid-19 and associated border restrictions and the carrier expects to lose $10 billion in sales this financial year.
Qantas has already cut around 6,000 jobs across the business to save on costs and additional lay-offs would see the airline’s workforce reduced to almost 30% of its pre-Covid size.
“Outsourcing this work to specialist ground handlers would save an estimated $100 million in operating costs each year,” said Andrew David, Qantas’ head of domestic operations.
The 10 airports that Qantas proposes to outsource ground handing work are Adelaide, Alice Springs, Brisbane, Cairns, Canberra, Darwin, Melbourne, Perth, Sydney and Townsville.
David added: “We’ve already taken drastic action, with more than 220 aircraft grounded, the vast majority of our workforce stood down and assets mortgaged to raise cash. Right now, our domestic capacity is at 20% of pre-Covid levels and international travel is expected to take years to recover.”
With the airline’s international operations not expected to recover until “at least mid-2021”, according to Qantas CEO Alan Joyce, the carrier’s international boss, Tino La Spina will leave the company.
La Spina’s departure from the business after 14 years’ service is another cost-saving move by Qantas. David will take over from La Spina’s responsibilities.
Joyce said: “The Covid crisis is forcing us to rethink our business at every level. It’s increasingly clear that our international flights will be grounded until at least mid-2021 and it will take years for activity to return to what it was before.
“Under those circumstances, we’ve made the decision to consolidate the domestic and international business units under a single divisional CEO.”